Limiting Medicare billing may weed out cheaters

What to make of the federal government extending its moratorium on allowing new medical providers to bill Medicare and Medicaid in six states?

Does CMS still need to get a handle on pre-screening providers before allowing them to bill?

Or is fraud is so rampant in those areas that CMS must weed out existing bad actors before allowing new providers to enter?

Probably both.

Shutting down enrollment is a drastic move that can hurt honest providers. It also can limit patient access to needed care. But it’s a necessary step for the federal government to  effectively manage fraud in its programs.

The areas affected by the extension include home-healthcare and medical transport — two that are rife with fraud.

Congress gave CMS the power to shut down enrollments a few years ago, but CMS hesitated at first. Nudged by Congress, CMS started restricting enrollments in limited areas where fraud was most out of control.

The enrollments seem to be a qualified success, but it will take a few years to fully know if provider fraud has started moving downward.

In the meantime, CMS is taking a smart approach to using its power to restrict enrollments. Moratoria are targeted. The latest extensions, for example, impose home-health enrollment limits in Florida on just three of the worst counties. Plus, CMS now allows exceptions to the moratoria if providers pass heightened screening.

Taking action before crooked providers can bill is the best answer to the old “pay-and-chase” model. It should also deter many would-be cheaters, especially organized fraud rings looking to soak federal programs.

Doc makes fortune from worthless mental-illness drugs

Mental illness made Dr. Fernando Mendez-Villamil rich and taxpayers that much poorer.

The Miami psychiatrist spooned out epidemic levels of antipsychotic drugs to seniors in Medicare and lower-income people in Medicaid.

Mendez-Villamil became a national icon of overprescribing. He peddled nearly 97,000 scripts for powerful anti-psychotic drugs to Medicaid patients between 2007 and 2009. That was more than any doctor for mental-health meds in Florida.

Years of plying people with unneeded drugs finally landed Mendez-Villamil in prison. He was one more swindler in a national epidemic of painkillers and other opioids that doctors and pharmacies are handing to addicts. Many overdose or die.

Insurance money pays for billions of dollars worth of the prescriptions. Insurance fraud thus is a major financier of opioid addiction in America today.

A U.S. Senate probe singled out Mendez-Villamil for profligate insurance over-billing. He was bounced from Medicaid in 2010 “without cause.” That was a fast-track sanction. It spoke to Medicaid’s concern about his peddling so many lower-income people with potent drugs they didn’t need.

Mendez-Villamil next soaked Medicare, doling out another 47,000 taxpayer-funded scripts to seniors in just two years. His busy practice justified the pills, he asserted to regulators with little success. Fed up, Florida’s medical board reprimanded and fined him.

Along the way, Mendez-Villamil amped up his scamming. He took bribes and kickbacks to doll out bogus diagnoses of crippling psychiatric illness so thousands of people could falsely qualify for Social Security disability, Medicare and Medicaid. Fake mental illness diagnoses also falsely exempted many people from testing to become U.S. citizens.

Anti-psychotic excess

Medicare, Medicaid and other federal programs lost more than $60 million in false and inflated claims.

Mendez-Villamil owned a $1-million mansion in Coral Gables. The place brimmed with expensive art — the feds impounded 221 paintings, prints, sculptures and other artworks when they raided his home.

He was handed more than 12 years in federal prison and must repay at least $50 million that he stole from taxpayers.

The conviction came seven lingering years after his prescribing habits came to the attention of the U.S. Senate. Some observers believe prosecutors and regulators took far too long to shut down Mendez-Villamil for good.

“I know what I did was wrong, I was dishonest,” Mendez-Villamil admitted to the federal court before sentencing. “That’s not the way I was raised. … I apologize for my behavior. I feel guilty. I’m sorry for the damage I have done.”

A strong rebuke came from the U.S. Senate, which singled out Mendez-Villamil for dangerous excess in hawking unneeded pills at taxpayer expense.

U.S. Sen. Charles Grassley (R-Iowa) led the headline-getting Senate probe in 2009.

“When I started looking at top prescribers a few years ago, there was a frustration that state and federal authorities were slow to look at the problem,” Grassley told ProPublica after Mendez-Villamil’s conviction in July 2016. “That has to change. Patients are served badly by doctors who commit fraud.”

Insurance fraud continues to finance opiod epidemic


First came Prince, who died from an overdose of the painkiller fentanyl in his Minnesota home.

Next came singer Chaka Khan. She beat the reaper by entering into rehab this month, along with her sister.

The Grammy winner admitted fentanyl is her escape drug of choice. Chaka wisely gave up her summer concert appearances to focus on getting clean.

“The battle of addiction is a serious and long process, which is why I chose to address my use of prescription medications — which came about as a result of the knee surgery I had a few years ago,” she said.

Fentanyl is one of latest prescription painkillers to grab headlines. It’s used for severe pain, and is approved for longterm treatment. The stuff also is up to 100 times stronger than morphine, and 50 times stronger than heroin.

Fentanyl quickly shoots into the bloodstream. Dopamine then elevates, stoking the brain’s reward areas. The sweet euphoria grows into dependence, then addiction.

States like New Jersey and Mississippi are reporting spikes in fentanyl overdose deaths.

Insurance fraud is the largely untold story. It’s helping finance America’s epidemic of opioid addiction — billions of stolen insurance dollars worth.

Some fentanyl addicts reportedly are scamming health insurers to score prescriptions that feed the need. Same with other painkillers such as hydrocodone, or anti-anxiety meds and muscle relaxants.

Insurance scams may or may not have funded Prince’s or Chaka’s highs. Yet scams still are part of the bigger opioid picture, so we should be very concerned.

Insurers are stepping up investigations, plus education of doctors and patients to head off addiction. Law enforcement is going after shady pain clinics and pharmacies that dole out insurer-paid scripts.

Still, we risk getting exhausted by it all. We’re subject to steady parades of news stories about people dying from insurance-paid overdoses. Plus welcome busts of cold-blooded pain docs. They’re keeping addicts fed with pills — are we getting fed up?

Sadly, it may take a celeb’s drug death or rehab to keep headlines fresh and the public concerned. Let’s stay concerned, whether it’s a Grammy winner or small-town factory worker just trying to get clean.

Scammers make desperate excuses to escape insurance-fraud busts

FOM_July16Not smart enough to lie about his injured ankle. That was the Hail Mary defense Todd Romero tossed up, trying to steal workers-compensation money for a supposedly injured ankle.

Insurance fraudsters like Romero often doll out brainless excuses when trying to vindicate their criminal behavior to investigators, judges or curious onlookers.

Errant birds, blood-sucking insects, multiple-personality disorder and too dumb. These are just some of the daffy defenses fraudsters peddle when cornered and trying — with a straight face — to explain unexplainable insurance cons that lurched out of control.

Investigators quickly see through paper-thin excuses. Claim denied, scam busted.

Take Romero. The Louisiana offshore oil worker lied that he hurt his left ankle while stepping onto a well platform from a crew boat in the Black Bayou. He started hauling in workers-compensation money for his injury.

Romero’s doctor told him to wear an orthopedic boot. Romero kept trying to find docs who’d give him a more-serious diagnosis — bigger injury equals bigger insurance money.

Yet video caught Romero pushing his truck, and walking normally without the boot. His employer denied his claim and accused him of fraud.

Romero lacked “mental acuity” to commit fraud, he desperately contended in court when confronted with the footage. After all, Romero was age 22 before he graduated from high school, he said. In other words, he wasn’t smart enough to be crooked.

Yet Romero earned a professional license and hydraulic crane operator card, and was certified as a first-aid responder. Claim denied in a civil suit.

Burglar and victim?

Then there’s the strange case of Elvis hobbyist Herbert Stewart. Thieves ransacked the Bethlehem Township, Pa. man’s home, he told his insurer. Nearly $7,000 of Elvis records, pictures and other memorabilia were lifted.

Stewart hid the stuff in his closet the whole time. For some reason he never thought insurance investigators actually would look for the stuff. They quickly found his Elvis stash, leaving Stewart to explain away his false claim in court.

He has multiple-personality disorder, Stewart told the judge. One personality was the burglar, and the other was the victim. Stewart’s medicines weren’t working, thus freeing his thief personality to rob his insurer. Stewart received six months of probation.

“Stop listening to the other guy. Alright?” the judged ordered.

It’s unclear which personality is serving the sentence.

Tried to save woman?

“If there were a Mount Rushmore of bad luck I think Andy House’s face would be on it,” federal prosecutor Chris Tortorice said.Anthony Thomas’s arson plot was cooked, and his excuse was half-baked. The New Orleans landlord burned down his duplex apartment, receiving a little insurance money for lost rental income.

A buddy rented an apartment in a house. He wanted to make an inflated insurance claim for damaged furniture. So they decided to burn down the entire house.

The crony splattered gasoline throughout the home and set the fire. The blaze lurched out of control, leaving Thomas trapped inside.

He barely escaped. He had serious burns and spent 60 days in the hospital’s burn unit. Investigators were curious how Thomas and the house were burned at precisely the same time.

Um, well, Thomas tried to save a woman trapped in a burning car near the apartment, he said. No go, the court retorted. Thomas has permanent burn scars, and no insurance money. He’ll have 17 years in federal prison to rethink his excuses.

“He did not gain anything from it,” his perplexed attorney John Hall Thomas said. “It’s difficult to understand why he did this.”

Veered into marsh

Blame an errant pelican and mosquito hoards, Andy House told insurance investigators probing why his $1-million Bugatti Veyron veered into a salty East Texas marsh to its doom.

Only 300 Veyrons were made. They were geared to reach 250 mph. House over-insured the car for $2.2 million and stood to make a hefty profit if his insurer paid the damage claim.

So House roared down a straightaway and calmly veered into the murky goo. He left the motor running, pulling salt water into the engine — effectively flooding and totaling the car.

A low-flying pelican suddenly swooped in front of the Veyron, House told his insurer. He jerked the car to avoid the bird, accidentally barreling into the swamp. House said he left the engine running because he was too busy swatting mosquitos in the boggy goo.

Yet in a fit of incredibly unlucky timing, a car enthusiast saw the Bugatti jetting down the road. Awed, he whipped out his cellphone to capture the rare moment. He recorded House zooming down the road and smoothly ploughing into the lagoon. No pelicans in sight, no sharp veering.

The video became an online sensation. Car lovers winced over the Bugatti’s demise. It also was one of the most-expensive crashes of a single car in history.

Investigators quickly discovered the video during an online search.

Birds and bugs didn’t wash with the court. House was left with a sodden $1-million wreck, a year in federal prison, and must repay the $600,000 insurance settlement. He also has a permanent place in the notorious Insurance Fraud Hall of Shame.

“If there were a Mount Rushmore of bad luck I think Andy House’s face would be on it,” federal prosecutor Chris Tortorice said.

Adverse decision in Kentucky could embolden crash rings


A Kentucky lower court has thrown a wrench in the campaign to combat the growing scams involving PIP crashes in the Bluegrass State. The court agreed with two claimants in an auto crash. They’re suspected of fraud. Insurers have no right to compel them to attend an examination under oath (EUO), the lower court ruled.

The Coalition and NICB filed an amicus brief this week asking the Kentucky Supreme Court to overturn the decision and restore insurer rights to use EUOs.

EUOs are a powerful weapon to get at the truth. When summoned, many fraudsters don’t bother showing up —especially lower-level ring members. They feel the few dollars they’re making don’t offset the potential of getting caught.

EUOs are a deterrent as well. Knowing there’s a chance you might have to give details of a claim under oath helps keep people honest.

Take the EUO away, and more fraud rings likely will escape detection and feel emboldened to commit more fraud.

The Kentucky claimants contend insurers use EUOs to harass and intimidate honest claimants. We’ve found no evidence to support this contention. We determined that insurers use EUOs very infrequently, and only when necessary to discover truth about a claim.

In fact, EUOs can be an important tool to validate legitimate claims.

Sometime later this year, the Kentucky supreme court will announce its decision. Here’s hoping they support uncovering the truth about potentially fraudulent auto claims.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.

New fraud laws start with open dialogue


Last week I took part in a public meeting the Maryland Insurance Administration held in Baltimore to review anti-frauds effort in the state. Part of the discussion surrounded anti-fraud bills that stalled this year when the 2016 session closed in mid-April.

The state insurance commissioner Al Redmer Jr. chaired the meeting. He stayed the entire time. He went beyond simply giving an opening statement, then handing the meeting to the fraud unit’s chief. Redmer’s lengthy presence showed a strong interest in strengthening state’s anti-fraud efforts.

I called for the state to redouble its efforts to target drivers who lie where they garage their cars to illicitly lower their auto premiums.

Maryland drivers should register and insure their vehicles in the state. Similarly, out-of-state drivers should pay a steep penalty for lying that they drive and garage their vehicles in Maryland to lower their auto premiums.

Maryland should be applauded for last week’s effort. The session started dialogue for targeting auto-premium evasion and other insurance crimes. This could spark renewed pushes for anti-fraud legislation next year. The 2017 legislative session opens in January.

Other states can learn from sessions like this one. A state’s anti-fraud effort is organic. Fraud fighters and the insurance department must continually review its direction and impact. No state should rest on its laurels, thinking it’s doing a great job. Nor should a state grow reluctant to act, believing the anti-fraud environment can’t be changed so why talk about it.

Maybe such a meeting in New York could help break up the logjam in Albany that has stalled so many worthwhile anti-fraud measures in recent years. Or, a state like Oregon which has no insurance fraud law or anti-fraud infrastructure. Imagine what the insurance departments and governors would learn if they held such meetings. Same with Michigan, which needs a fraud bureau.

More often than not, legislatures act in a vacuum when they look at anti-fraud laws. Too often they’re pulled in several directions, making it hard to focus on enacting anti-fraud laws.

Fraud fighters should assume leadership and start action-driven dialogue. Reach out to the state insurance department, insurance commissioner and state attorney general. Co-sponsor open meetings to review their state’s fraud trends, and where new fraud laws are needed.

These joint efforts can go a long way toward enacting needed laws and regulations that make a state’s anti-fraud efforts stronger than ever.

About the author: Howard Goldblatt is director of government affairs for the Coalition Against Insurance Fraud.

Slip and falls: The big waste


Imagine coming home from a long day at work. You climb on a full bus. Soon the vehicle suddenly screeches to a halt. An elderly man outside falls onto the pavement. The bus hit him at a stop light, he screams in seeming pain. The passengers have to clear out, and you’re still a mile from home.

You hear ambulance sirens rushing to the scene. Yet nobody’s fooled. Children and adult passengers are calling out this fraudster. They’re yelling things like, “He just wants to get money!”

You remember sitting in the front of the bus, and it never touched the man … at all. No bump, no thump.

If you’re wondering if that insurance grab happened … it did … to me.

I’m an insurance-fraud researcher with the Coalition Against Insurance Fraud. I read about and see videos of fraudsters faking slip and falls all the time. They seemed like a fantasy until I saw this guy’s scam first-hand.

Slip-and-fall cons may steal billions of dollars a year. Honest businesses are sued. They pay in higher premiums. We pay in higher prices at the cash register.

Some fraudsters place liquid detergent or other slippery stuff on supermarket floors. They sit down on the floor and scream they slipped on the mess. They’re blithely unaware that security cams record every false move.

Selena Edwards of California claimed a scalding cup of hot coffee with a loose lid slipped off and burned her hand at a McDonald’s drive-thru. But she’d used a photo of someone else’s burned hand. And her medical records also were forged. Edwards was convicted.

Some consumers even joke about it on social media.

Slip-and-falls are a quick way to make big bucks, people often yack. Search the hash tag #BoutToSlip on Twitter. You’ll see youngsters joking about slipping and falling to claim insurance money. This kind of peer-to-peer chatter can egg others to fake a money-grabbing slips.

Or check out the #insurancefraud hash tags on Vine and Instagram. Plenty of quick videos of young people joking how to pay college tuition by scamming insurers with bogus tumbles.

My experience on the bus plus my research with the Coalition made one thing clear: Slip-and-falls are a big waste for everyone. This is especially true of scammers who end up with permanent criminal records after their cons slipped, fell and broke.

About the author: Elijah Mercer is research associate of the Coalition Against Insurance Fraud.

Legal update: Courts broadly view fraud laws to bolster crime fighting


By Matthew J. Smith, Esq.

Fraud fighters are convincing courts view insurance fraud as a serious crime when making rulings. Several courts thus broadly applied state and federal laws to combat this epidemic in recent months.

Whether involving auto claims, medical fraud or other violations, recent state and federal cases are strengthening — though in some cases limiting — the fraud fight.

Luis v. United States, 136 S.Ct. 1083 (2016)

Issue: May the federal government freeze assets not connected to a suspected fraud or crime?

Petitioner Luis was charged with Medicare fraud under federal and state laws. The federal government froze his assets as “fruits of the poisoned tree” arising from his alleged fraud. Luis objected to the seizures. He claimed the government denied him his Sixth Amendment right to representation by legal counsel because he could not use his financial assets to hire an attorney.

Even if the government convicted Luis, his legitimate assets and income from non-criminal activities were wrongfully seized, he contended. That seizure also denied him his constitutional right to use untainted assets to hire legal counsel.

Decision: Restraining his “legitimate,” untainted assets needed to retain counsel violates his Sixth Amendment rights. A court majority believes the right to legal counsel of one’s choice supersedes the government’s right to seize assets. This is true, even if it appears before conviction that most of his assets were gained fraudulently.

The court rationalized it should be possible to review financial records and determine which assets are “clean,” and which stem from potential fraud.

Importance: Any decision by the U.S. Supreme Court has wide impact on lower federal courts, and state courts reviewing similar issues. All Americans should be concerned about overreaching governmental authority and improper seizing of assets. This decision makes it harder for government agencies and law enforcement to identify “legitimate” versus fraudulently obtained assets.

The question is whether federal and state courts will apply this decision beyond Medicare fraud. Other federal and state statutes often allow seizing assets if a prima facie fraud case is established. This prevents suspects from liquidating assets before a criminal conviction.

This decision clearly places the responsibility on the government agency to properly determine untainted versus fraudulently obtained assets before seizing.

Husky Int’l Electronics, Inc. v. Ritz, 136 S.Ct. 1581 (2016)

Issue: The U.S. Supreme Court was asked to define “actual fraud” in interpreting what constitutes a fraudulent conveyance. The court addressed whether a debtor’s misrepresentation is required to establish “actual fraud.”

Husky International provided expensive electronic equipment to a company owned in part and controlled by defendant Ritz. The components were delivered to the buyer, but never paid for. Husky tried to collect. Ritz placed the company into bankruptcy to avoid paying.

Husky claimed the bankruptcy process was a fraudulent attempt to escape paying. Even if the bankruptcy was valid, Ritz committed “actual fraud” and should remain personally liable for paying for the electronic equipment even his then-corporation made the purchase.

Decision: The Supreme Court ruled for Husky. Even if the bankruptcy was valid, it was possible to “pierce the corporate veil” and seek recovery for the unpaid invoices directly from Ritz. The court agreed Ritz filed for bankruptcy solely to avoid paying for legitimate expenses. The term “actual fraud” encompasses fraudulent-conveyance schemes, even if they do not involve a false representation.

Even though the bankruptcy filings were not false on their face, the bankruptcy’s intent met the definition of “actual fraud.” Husky is entitled to collect the debt directly from Ritz even if the corporation was insolvent.

Importance: This is one of the most far-reaching decisions affecting insurance fraud to come from the U.S. Supreme Court in years. The court took an expansive definition of “actual fraud.” The term may be used for all federal laws and statutes, and potentially state levels.

In sweeping language, the court said “actual fraud” includes a wide variety of interpretations, actions and schemes. The defendant must intend to commit fraud and gain an unfair advantage or financial gain.

Importantly, the Supreme Court adopted a broad view of “actual fraud.” This agrees with the Coalition’s legal positions. The Coalition urges federal and state courts to broadly construe laws and statutes addressing fraud. The courts should provide wide latitude in applying those laws against fraudsters.

Allstate v. Rehab Alliance of Texas (Supreme Court of Texas)

Issue: Allowing medical providers to hide false claims amid treatment for crash injuries will encourage scams and could discourage insurers from writing business in Texas, the Coalition contends in an amicus brief.

Allstate alleges Houston-based Rehab Alliance recruited legitimate crash victims for false injury treatment. The clinic upcoded treatment, billed doctor rates for work by nurses, and performed unneeded treatment such as MRIs, the insurer asserts. Patients also were secretly told they weren’t financially liable for uninsured treatment, Allstate says.

The clinic camouflaged false treatment claims involving legitimate crash injuries. Unlike staged wrecks with fake injuries, this sophisticated disguise makes it daunting to clearly separate bogus from necessary treatment claims.

The insurer paid 107 claims and sued to recover after discovering evidence of fraud. A lower court granted Rehab Alliance summary judgement. Allstate appealed to the Texas Supreme Court.

Decision: Pending.

Importance: Insurers need access to civil courts and the ability to sue fraudsters. Allowing camouflaged injury claims burdens insurers with higher costs that raise premiums. Medical care and the ability of insurers to promptly settle claims will suffer as well.

Patel v. Allstate New Jersey Ins. Co. (3rd Cir. 2016)

Issue: Does plaintiff have standing to allege the New Jersey Attorney General and the state Office of the Insurance Fraud Prosecutor improperly outsourced criminal investigations to insurer Special Investigation Units? 

Insurer SIUs assist the state Attorney General and insurance department in investigating insurance fraud. This joint effort combines public- and private- sector resources. Insurers often have more resources to assist the state in combating fraud.

Decision: In a limited decision, the court ruled Dr. Patel has no legal standing to bring the case. The court did not directly address whether mixing public- and private-sector investigations is proper in New Jersey.

Patel could not prove he sustained any injury because the state never prosecuted him for insurance fraud. Patel argued the mere combining of a government function with a private insurance company violated his constitutional rights. The court didn’t address this issue, or determine if these joint efforts were proper even if criminal charges were filed.

Importance: It is regrettable the court did not address the key issue. New Jersey is a model of public-private partnership in investigation and prosecuting insurance fraud.

The court gave no clear direction whether such joint efforts pass constitutional muster in New Jersey. The Coalition supports joint anti-fraud efforts at all levels — within governmental agencies, and between governmental agencies and private entities.

Iowa v. Rimmer, 2016 WL 1165751 (2016)

Issue: May persons from Wisconsin and Illinois be charged in Iowa for running a staged-crash ring without even entering the state of Iowa?

The defendants staged vehicle crashes involving bogus injury treatments. The scheme took place in Chicago. The fraudsters didn’t know the insurer’s claims office in Davenport, Iowa handled those claims.

Criminal charges were filed in Iowa after communications between the Iowa claims office and local prosecutor. The defendants moved to dismiss. They said they were not subject to Iowa jurisdiction. The crashes happened in Illinois, they did not reside in Iowa, and did not commit fraud in that state.

Decision: In a broad decision, the Iowa Supreme Court said “persons engaged in multi-state insurance fraud assume the risk of prosecution wherever victims are located. A contrary holding impedes the ability to prosecute and deter multi-state insurance fraud schemes…”

The court addressed the rise of the internet and multi-state (and even multi-national) communications as an increasing part of society.

Where the defendants live was not material. Nor was the location of the underlying accidents, if the scheme was connected to Iowa in any way. The claims were adjusted in Iowa. A sufficient nexus thus existed between Iowa and the fraudsters to  sustain criminal charges in Iowa.

Importance: This is the type of broad, far-reaching decision the Coalition urges state and federal courts to take. With the internet’s rise, fraud no longer is limited to a geographic area or region. Decisions such as this allow prosecuting fraud on a much wider spectrum than before — in keeping with changing technology.

The Coalition long has urged courts to take a longrange view of insurance fraud as it as it changes with new technology. This view best ensures laws are updated and courts apply the law in alignment with evolving society.

New Jersey v. Goodwin, 224 N.J. 102 (N.J. 2016)

Issue: What constitutes a false statement, and does acquittal in a criminal action bar a subsequent insurance-fraud action?

Facts: The insured owned an SUV her boyfriend burned so she could falsely collect insurance money. Criminal charges were brought against the boyfriend in a separate case. He was acquitted. The boyfriend next was charged with insurance fraud. He allegedly assisted his girlfriend in making the false claim with her insurer.

The boyfriend argued the insurer did not rely on his statements, even if they were false. That he was acquitted on the criminal charges barred  subsequent prosecution under the state’s insurance-fraud statute, he contended.

Decision: The New Jersey court recognized that the insurer knew from the start the boyfriend lied. The insurer never relied on his statements in pursuing the claim.

Still, any false statements intended to influence an insurer to pay a false claim can support a fraud conviction. The boyfriend’s acquittal of burning the vehicle was a separate charge. He still can later be charged and convicted of insurance fraud under the state statue.

Importance: Both rulings broadly support the battle against insurance fraud. Prosecutors and courts are empowered to use state fraud statutes for maximum impact. If other states adopt these expansive views, the requirement of insurers to prove they relied upon false statements would no longer would exist.

The intentional making of false statements to an insurer will sustain a fraud conviction. This broad ruling also buttresses the Coalition’s position for broad court interpretation of statutes to support the fraud fight.

About the author: Matthew J. Smith, Esq. is founder and president of Smith, Rolfes & Skavdahl Company, L.P.A. He has practiced for nearly 30 years in the field of insurance law, defending insurers and assisting with insurance-fraud investigations. Smith is a past president of the National Society of Professional Insurance Investigators, current member of IASIU, and legal advisor to the Coalition Against Insurance Fraud.